Document Status

Overview & Justification

Purpose

The purpose of this document is to describe the functional specifications for a new commercial module which is the “303 VAT Settlement” as a valid file.

303 VAT Settlement is aimed to allow the end-user to calculate the amount to pay or collect from the Public Treasury as the difference between the VAT -fiscal Debit (In Spanish = "IVA repercutido") and the VAT-fiscal Credit (In Spanish = "IVA soportado").

303 VAT Settlement must be sent to the Tax Authorities either monthly or quarterly within the 20 days of the next Month/Quarter, respectively.

This report must be mandatory sent through the INTERNET – on line submission of a valid 303 file in case of monthly submission, otherwise (quarterly submission) end-user can choose between on-line submission or paper submission.

On line submission implies that the Spanish companies must have a Tax ID as well as a user Certificate X.509.V3 issued by FNMT or any other valid Certificate according to tax authorities requirements.

This new feature is going to be developed and delivered as a new commercial module which will be part of the Professional Edition of the Spanish Pack which will be implemented according to the Technical Documentation which can be found here : Spain AEAT Modelo 303 Technical Documentation

Scope

In Scope:

303 VAT Settlement submission as a valid txt file which can be submitted through below AEAT (Spanish Public Treasury) link:

This functionality takes into account as Deductible VAT, the VAT included in any "Account Payable" related transaction such as a purchase invoice or a payment to a vendor, which is 100% deductible.

New in the Scope!!

Due to the fact that there are new VAT Tax Rates valid From July 1st 2010 in Spain, a new version of the module needs to be develop.
"Normal" VAT Tax rate valid starting from July 1st, 2010 is 18% (instead of 16%)
"Reduced" VAT Tax rate valid starting from July 1st, 2010 is 8% (instead of 7%)

This new version of the module "303 VAT declaration" will allow the end-user to get a valid file according to the Spanish Tax authorities requirements detailed below:

"303 VAT declaration, for tax periods beginning July 2010 could have taxable transactions under the new tax rates (18%, 8%) together with others under the old tax rates (16%, 7%). In such cases:

Box 01 - File position 72 to 88- will get the the sum of the 18% and 16% related tax base amounts

by example 1.000,00 + 2.000,00 = 3.000,00

Box 03 - File position 94 to 110 - will get the sum of the 18% and 16% related tax amounts

Box 05 - File position 128 to 132 - will get a tax rate (integer part + 2 decimals), calculated as sum of the 8% and 7% related tax amounts / sum of the 8% and 7% related tax base amounts

by example (670,00 /9.000,00) * 100 = 7,44

Rest of File positions should remain the same.

Justification

303 VAT settlement is a legal requirement in Spain under "Orden EHA/3786/2008, dated on December 29th (BOE December 30th, 2008); which describes 303 VAT Settlement logical and physical design as well as the way and time for its submission to the Spanish tax authorities.

As said above 303 VAT Settlement main purpose is to calculate either the VAT to pay or the VAT to collect to/from the Spanish Tax Authorities as the difference between:

"VAT Payable" = "IVA repercutido" (In Spanish), this VAT is the one included in any Account Receivable related transaction such as a "Sales invoices" or a "Collection/Receipt" from a customer.

and "VAT Deductible" = "IVA soportado/deducible" (In Spanish), this VAT is the one included in any Account Payable related transaction such as a "Purchase Invoice" or a "Payment" to a vendor.

Above calculation must be mandatory done on a regular basis, either monthly or quarterly by all the VAT-payers.

New definitions and acronyms

VAT => Value-added tax

VAT Payable => Value-added tax included in any "Account Receivable" related transactions such a "sales invoice or a collection from a customer", in Spanish (IVA Devengado)

VAT Deductible => Value-added tax included in any "Account Payable" related transactions such a "purchase invoice or a payment to a vendor" which is 100% deductible, in Spanish (IVA Deducible) .

AEAT=> Acronyms for the Spanish Public Treasury = “Agencia Estatal de Administración Tributaria”

Tax Base Amount => it is the same as "Taxable Amount", which means the net amount VAT is calculated for, in Spanish "Base Imponible".

Tax Amount => VAT amount, in Spanish "Cuota"

Tax Rate => VAT %, in Spanish "Tipo %"

Total Amount => this one is the gross amount including VAT.

Users & business process description

User goals

303 VAT Settlement will allow the end user to:

Get the VAT rates to be included in the 303 VAT Settlement properly Setup by getting them linked to the corresponding 303 output parameters.

Generate 303 VAT Settlement for a given period, either a month or a quarter as a valid file according to Spanish Tax Authotities requirements.

User Roles and Personas

Accounting Manager (Mary):
Mary is the accounting manager. She is the accountant responsible therefore she needs to make sure that the Company complies with the Law and the Tax requirements.

She should be able to review 303 tax report setup provided by OB and adjust it if required based on her company specific needs.

She should also be able to launch 303 tax report whenever needed in order to submit it to the tax authorities as a valid file.

Sales staff (Mike): Mike is an employee part of the sales staff. He will be the one issuing sales invoices including VAT in the system, which therefore must be part of the 303 VAT Settlement.

Purchase staff (Alice): Alice is an employee part of the purchase staff. She will be the one entering purchase invoices including VAT in the system, which therefore must be part of the 303 VAT Settlement.

Business scenario/s

Small Bazaar is an enterprise located in Spain made of several subsidiaries. Small Bazaar Holding is the parent company while, Small Bazaar Pamp and Small Bazaar Barc are two subsidiaries. Each subsidiary is modeled in OB ERP as a legal entity organization.

Sales transactions (June):

On June 7th Mike issues a sales invoice to customer A (a National Small Bazaar Pamp customer).

Dated on July 20th, Mary generate 303 VAT Settlement for June 2010 and she gets that Small Bazaar company needs to pay to the Tax authorities 1.200,00€ because VAT Payable = 1.600,00€ > VAT Deductible = 400,00.

Sales transactions (July):

On July 7th Mike issues a sales invoice to customer B (a National Small Bazaar Pamp customer).

Functional requirements

Functional Requirement 1 - Accounting Date

Transaction/Documents Accounting date is the date to take into account while retrieving tax transactions.

Companies must take into account:

Devengo del IVA (in Spanish) => which means Companies must take into account when the "VAT is chargeable" and therefore must be submitted to the Tax Authorities - the VAT Payable and the VAT Deductible must be submitted to the Tax Authorities in the period when the Goods/Services have either been delivered (Sales-VAT Payable) or received (Purchase-VAT Deductible); let's say June.

Obligaciones de Facturación (In Spanish) => Besides the above, companies must invoice within the next 30 days after the delivery/receipt of the Goods/Services, but within the same settelment period, which in our case is June, therefore invoices must be issued July 16th the latest, as June VAT Settlement must be submitted to the tax authorities dated on July 20th; the latest.

In order:

not to loose these invoices dated from 1st July to 20th July in our example,

which could either belong to June VAT Settlement in case the operation date was June or belong to July VAT Settelemnt in case operation date was July

and which could also do not have either a good receipt/shipment for us to easly know the operation date

and because of the fact that Purchase invoices can have an invoice date dated on February, 2010; while are entered in the system later on, let's say June; so we could miss the period when the VAT Deductible was supposed to be submitted.

Base on all of the above, the accounting date of the invoices/transactions is the date to be taken into account because:

Sales invoices must be issued in the same period that the operation took place and at the same time/period must be posted, most cases

Purchase invoices can be recognized in the system when are posted, most cases.

VAT Settlements Periods, in case of monthly declaration, will go from the 1st day of the month to the last day of the month, which means:

June period to be submitted to the tax authorities July 20th the latest, will take into account Invoices/Transactions having as "From Date" = or > June 1st and as "Date To" = or < June 30th.

Those transactions with Invoice date "From Date" = or > July 1st and as "Date To" = or < July 20th, wll be taken into account in July VAT Settlement period, regardless could be related to June transactions.

End user must enter here "Regularización de las deducciones por Bienes de Inversion" amount based on the final %.
Only required in 4T or month 12.

646

5

[39]

Liquidación (3) - Atribuible a la Administración del Estado % [39]

(*) this one could also be setup as a "Constant"

Numeric

Those VAT Payers of both Public Treasury="Administración del Estado" and "Diputaciones Forales del Pais Vasco o Navarra" must enter here the
% of transactions under Public Treasury.
For those VAT Payers of Public Treasury the % must be 100,00%

The sum-up of all the Tax Amounts linked to any of the VAT Payable Tax Rates listed below in [03] / The sum-up of all the Tax Base Amounts linked to any of the VAT Payable Tax Rates listed above in [01]

94

17

[03]

Liquidación (3)

IVA Devengado - Régimen general - Cuota [03]

The sum-up of all the Tax Amounts linked to any of the VAT Payable Tax Rates listed above in [01]

111

17

[04]

Liquidación (3)

IVA Devengado - Régimen general - Base Imponible [04]

The sum-up of all the Tax Base Amounts linked to any of the VAT Payable Tax Rates listed below:

The sum-up of all the Tax Amounts linked to any of the VAT Payable Tax Rates listed below in [06] / The sum-up of all the Tax Base Amounts linked to any of the VAT Payable Tax Rates listed above in [04]

133

17

[06]

Liquidación (3)

IVA Devengado - Régimen general - Cuota [06]

The sum-up of all the Tax Amounts linked to any of the VAT Payable Tax Rates listed above in [04]

150

17

[07]

Liquidación (3)

IVA Devengado - Régimen general - Base Imponible [07]

The sum-up of the Tax Base Amounts linked to any of the VAT Payable Tax Rates listed below:

The sum-up of all the Tax Amounts linked to any of the VAT Payable Tax Rates listed below in [12] / The sum-up of all the Tax Base Amounts linked to any of the VAT Payable Tax Rates listed above in [10]

211

17

[12]

Liquidación (3)

IVA Devengado - Recargo de Equivalencia - Cuota [12]

The sum-up of the Tax Amounts linked to any of the VAT Payable Tax Rates listed above in [10]

228

17

[13]

Liquidación (3)

IVA Devengado - Recargo de Equivalencia - Base Imponible [13]

The sum-up of the Tax Base Amounts linked to any of the VAT Payable Tax Rates listed below :

The sum-up of all the Tax Amounts linked to any of the VAT Payable Tax Rates listed below in [15] / The sum-up of all the Tax Base Amounts linked to any of the VAT Payable Tax Rates listed above in [13]

250

17

[15]

Liquidación (3)

IVA Devengado - Recargo de Equivalencia - Cuota [15]

The sum-up of the Tax Amounts linked to any of the VAT Payable Tax Rates listed above in [13]

267

17

[16]

Liquidación (3)

IVA Devengado - Recargo de Equivalencia - Base Imponible [16]

The sum-up of the Tax Base Amounts linked to any of the VAT Payable Tax Rates listed below:Entregas IVA+Recargo 4+0,5% (+0,5%)

284

5

[17]

Liquidación (3)

IVA Devengado - Recargo de Equivalencia - Tipo % [17] = 00,50

0,5%

289

17

[18]

Liquidación (3)

IVA Devengado - Recargo de Equivalencia - Cuota [18]

The sum-up od the Tax Amounts linked to any of the VAT Payable Tax Rates listed above in [16]

306

17

[19]

Liquidación (3)

IVA Devengado - Adquisiciones Intracomunitarias - Base Imponible [19]

The sum-up of the Tax Base Amounts linked to any of the VAT Payable Tax Rates listed below:

In order to check 303 VAT Settlment and 303 parameters setup he should navigate to Financial Management / Accounting / Setup / Tax Report and check that there is a Tax Report with a Search key => AEAT303_M or AEAT303_Q with below setup:

Tax Report (Header):

Client=> OB Client for which 303 is setup.

Organization => OB organization or legal entity for which 303 is setup.

Same as explained in the scenario below would happen in case Mike needs to :
- issue a sales invoice dated on July 25th at a 18% VAT Rate, tax base amount 1.000,00 and tax amount 180,00
- and void a June sales invoice dated on July 27th at a 16% VAT Rate, tax base amount 500,00 and tax amount 80,00

In this scenario the result must look like:

Tax Base Amount = 1.000,00 - 500,00 = 500,00 [01]

Tax Rate % = (100,00 / 500,00)*100 = 20,00[02]

Tax Amount = 180,00 - 80,00 = 100,00 [03]

National Sales Invoice (Goods and Services) - 2 VAT rates in the same invoice

Above VAT Payable must be captured in the VAT Settlement for June period - VAT Payable section:

Tax Base Amount = -1.000,00 [01]

Tax Rate % = 16,00 [02]

Tax Amount = -160,00 [03]

In case there is no other positive Invoice for that period, otherwise it would look like:

Tax Base Amount = 5.000,00 - 1.000,00 = 4.000,00[01]

Tax Rate % = 16,00 [02]

Tax Amount = 800,00 -160,00 = 640,00 [03]

Same applies in the case of Services in relation to 303 data to be retrieved, in that case the VAT rates will the ones linked to the Tax Categories "IVA Normal Servicios", "IVA Reducido Servicios" or "IVA Super Reducido Servicios" at the same % rates as VAT Categories for Goods "IVA Normal", "IVA Reducido" and "IVA Super Reducido".

National Sales Invoice (Goods or Services) - Reversed Invoice of a previous period

Dated on July 25th, Mike needs to issue a corrective invoice because part of the goods send and invoiced to Customer A have been returned.

Tax = "Entregas IVA 16%" (the system will not show up this Tax type because dated on = or > July 1st, 2010; system will show up "Entregas IVA 18%" unless the original invoice is fully voided, therefore Mike must select the Tax Rate used in the original invoice being corrected).

Tax Base Amount = "-500,00"

Tax Amount = "-80,00"

Under the tab "Reversed Invoices", Mike will be able to select the original invoice being reversed.

Once the negative sales invoice is processed and posted, the corresponding accounting entries are posted as shown below:

Above VAT Payable must be captured in the VAT Settlement for July period - VAT Payable section but having a 16% VAT instead of 18%:

Tax Base Amount = -500,00 [01]

Tax Rate % = 16,00 [02]

Tax Amount = -80,00 [03]

In case there is no other positive Invoice for that period at 16% and another one at 18%, otherwise it would look like:

Tax Base Amount = 5.000,00 - 500,00 = 4.500,00[01]

Tax Rate % = 16,00 [02]

Tax Amount = 800,00 -80,00 = 720,00 [03]

Tax Base Amount = 1.000,00 [04]

Tax Rate % = 18,00 [05]

Tax Amount = 180,00 [06]

Same applies in the case of Services in relation to 303 data to be retrieved, in that case the VAT rates will the ones linked to the Tax Categories "IVA Normal Servicios", "IVA Reducido Servicios" or "IVA Super Reducido Servicios" at the same % rates as VAT Categories for Goods "IVA Normal", "IVA Reducido" and "IVA Super Reducido".

Mike can enter in the system diferent sales invoices types depending on the BP (Customer) and the Products/Services for which a sales invoice is issued to.

In case of a National negative Sales Invoice, below data must be entered:

Transaction Document type = AR Invoice

Invoice date = 25-06-2010

Accounting date = 25-06-2010

Business Partner = "EU Customer C" (located in Belgium)

and then go to "Lines" tab. Once there Mike must enter below data:

Line 10

Product = "Product A" (which belongs to Tax Category "IVA Normal")

Invoiced quantity = "-10"

Net Unit Price = "100,00"

Tax = "Entregas intracomunitarias (%N=>0%)" (system will show up this Tax type based on setup).

Tax Base Amount = "-1.000,00"

Tax Amount = "0.00"

Under the tab "Reversed Invoices", Mike will be able to select the original invoice being reversed.

Once the negative sales invoice is processed and posted, the corresponding accounting entries are posted as shown below:

1.000,00 Customer (Credit)
1.000,00 Income (Debit)

Above VAT Payable must be captured in the VAT Settlement for June period - VAT Settelement section:

Tax Base Amount = -1.000,00 [42]

In case there is no other positive Invoice for that period, otherwise it would look like:

Tax Base Amount = 5.000,00 - 1.000,00 = 4.000,00 [42]

Same applies in the case of Services in relation to 303 data to be retrieved, in that case the VAT rates will the ones linked to the Tax Categories "IVA Normal Servicios", "IVA Reducido Servicios" or "IVA Super Reducido Servicios" at the same % rates as VAT Categories for Goods "IVA Normal", "IVA Reducido" and "IVA Super Reducido".

Exports (Goods)

Mike can enter in the system diferent sales invoices types depending on the BP (Customer) and the Products/Services for which a sales invoice is issued to.

In case of an "Export" Sales Invoice, below data must be entered:

Transaction Document type = AR Invoice

Invoice date = 17-06-2010

Accounting date = 20-06-2010

Business Partner = "Customer USA" (located in United States)

and then go to "Lines" tab. Once there Mike must enter below data:

Line 10

Product = "Product A" (which belongs to Tax Category "IVA Normal")

Invoiced quantity = "100"

Net Unit Price = "100,00"

Tax = "Exportaciones (%N=>0%)" (system will show up this Tax type based on setup).

Tax Base Amount = "10.000,00"

Tax Amount = "0,00"

Line 20

Product = "Product B"(which belongs to Tax Category "IVA Reducido")

Invoiced quantity = "100"

Net Unit Price = "100,00"

Tax = "Exportaciones (%R=>0%)" (system will show up this Tax type base on setup).

Tax Base Amount = "10.000,00"

Tax Amount = "0,00"

Once the sales invoice is processed and posted, the corresponding accounting entries are posted as shown below, there will not be any VAT posting:

20.000,00 Income (Credit)
20.000,00 Customer (Debit)

Above VAT Payable must be captured in the VAT Settlement for June period - Settlement Section:

Tax Base Amount = 20.000,00 [43]

Same applies in case of a negative Sales Invoice for an Export (Goods) of an amount = 5.000,00 by example. The VAT payable must be captured in the VAT Settlement for June period - Settelment Section as shown below:

In case of Capital Good purchase such as a car, a building or whatever, the VAT Deductible is not be 100% deductable within the same period that good was purchased. That type of VAT can be deducted in a period of time well defined by the Tax Authorities.

Therefore and for a give period (month or quarter) Alice must manually filled in below data as input if any:

Assumptions & Dependencies

Assumptions

Dependencies

Design & Technical considerations

Design considerations

303 VAT Settlement must be implemented as a commercial module which will be later on part of the Spanish Professional Localization Pack.

Technical constraints

None

Technical Requirements

303 file generation must be based on an existing feature named “Tax Report Launcher” so there is no need for new fields/tables/parameters creation.

User interface

New User Interface

N/A

User interface changes

License

License code description

The Spanish Professional Pack is released under the "Openbravo Commercial License" (OBCL) as opposite as the Openbravo Public License (OPL) for open source modules

The OBCL needs to be accompanied by a "term sheet" that describes the specific licensing terms per module.

It is likely that a number of enhancements to modularity will be needed in order to store the term sheet as attributes of the module and to display them when the user acknowledges the license.

Product Strategy is responsible for publishing the license on the Openbravo web site. Developers are responsible for putting a reference to that license in the file header and to declare it in the module definition.

Functionality enabled by the license code

The functionality enable by the license code will be “303 VAT Declaration as a valid file”